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Some information about alternative-energy production in Minnesota

The high price of gasoline and long-term scarcity of petroleum has created a strong demand for alternative energy. Ethanol, created from corn, has emerged as an early candidate to fill this need. But ethanol consumes too much ground water and consumes corn that could be used for food. (Food prices have shot up around the world.) Even if America’s entire corn crop could be diverted to ethanol production, that would satisfy only 6 percent of our petroleum need.

So what is the answer? An immediate answer might be to substitute natural gas for gasoline since this commodity is relatively plentiful and cheap. A single trash truck powered by natural gas is equivalent to more than 300 automobiles using gasoline. If utilized extensively, natural gas could take care of 38 percent of our oil imports. The big oil companies resist this solution because of their huge investment in petroleum for personal transportation.

Biofuels, not using corn but waste products from the farm, mightalso be part of the answer. A partnership between Royal Dutch Shell and a Madison, Wisconsin, firm called Virent Energy Systems will be developing the technology to turn sugar-cane pulp and switchgrass into a fuel which they call “biogasoline”. Conservation will be part of the answer. People walk or ride bicycles, eliminate unnecessary trips, carpool, or take buses. In California, drivers are using less gasoline than a year earlier for six consecutive quarters - about 1.1 percent less in 2007.

Another possible solution is to derive more energy from wind power. The Twin Cities’ largest operator of gas stations, Bobbi Williams, has recently become chairman of Wind Energy America which will be developing this technology. A farm boy himself, he says “Wind is hot and it’s free. The turbines are expensive, but there’s no waste. It’s clean. It just needs to be harnessed.”

I would like to focus here on wind power as an energy source. Wind is completely renewable. It requires a partnership between local interests - in rural Minnesota, which needs economic development - and firms offering capital and technology. Also, the electricity produced from wind has a possible application to cars which, in turn, consume the bulk of gasoline.

On the negative side, wind turbines are often too expensive for individual farmers and the technological challenges can be great. Also, there is a problem of hooking up to the power grid. To get electricity from scattered farms to transmission lines carrying electricity to their point of consumption, you need to have the power lines which are expensive and encroach upon private property. Also, it appears that government has dropped the ball in this area. The regulatory process is cumbersome. Tax incentives and subsidies mainly benefit the big producers.

The following information is relevant to this question:

Anyone who wants to build wind turbines needs to get permission to connect to the existing power lines. The regional agencies of the Federal Energy Regulatoy Commission - in our case, Midwest ISO - are the bodies granting permission. However, the process is stalled because of the large number of requests. The agency typically spends two years processing the request. To compete the 306 requests for approval now in the pipeline, it would take 612 years. This is a major bottleneck in the development of wind power.

To get the cost structure in line, the Minnesota legislature considered (and perhaps adopted) a proposal to require the electric-power companies - primarily Xcel Energy - to buy the electricity furnished by small producers at a price that covers their costs and gives them a reasonable rate of return. This model, called “feed-in tariffs”, has worked well in Germany which has expanded its wind capacity by 70 percent each year over the past decade. Small power producers need assurance of a stable price structure.

Wind power has become increasingly popular in rural areas. The industry has grown by 14 to 25 percent each year since 1990. Manufacturers of wind turbines have seen steady sales growth. To get past the cost hurdle, large developers have teamed up with small producers. For instance, a Minneapolis-base firm called National Wind has agreements to develop 25 wind projects in Minnesota, Iowa, and the Dakotas. This firm provides capital and technological expertise and, in return, receives money from a one-time development fee plus a certain percentage of future revenues from sale of electricity to the power companies. It’s based on Minnesota’s Community-based Energy Development laws, passed in 2005, which require the power companies to offer community producers upfront money to pursue projects.

Another interesting possibility is that of using electricity produced on the farm to power automobiles, either in electric cars or in gas-electric hybrids. In January 2008, the government of Israel approved a plan of an Israeli-American entrepreneur to create a nationwide network of recharging stations - a half million of them - and to mass produce electric cars. This is a joint venture between Renault-Nissan, which will build the cars, and the firm Project Better Place. It is an ambitious plan to see if we can kick the gasoline habit. Lithium batteries, similar to those used for recharging cell phones, will be used in the cars.

A possible benefit of electric cars is that electricity produced on the farm can be used without having to transport it long distances through power lines. Technologies of battery recharging can be improved to the point that the electricity can be used near its point of origin. It can also be used for electrolysis by which molecules of water are broken into hydrogen and oxygen atoms. In this case, the recovered hydrogen would be used as fuel to power cars, emitting water vapor as an exhaust. New technologies are being developed to store hydrogen in plates for easy transportation.

The large automobile companies are, of course, interested in these alternative technologies. While General Motors tends to favor increased use of ethanol, Toyota expects to sell more than a million gas-electric hybrid cars each year in the coming decade. Hydrogen fuel cells, plug-in hybrids, and pure electricity will be part of the mix. A Chrysler spokesman suggested that ethanol and biofuels were short-term solutions, and hydrogen was the long-term solution. Ford believed that second-generation biofuels, or cellulosic ethanol, which is not produced from food stock, offered a promising fuel in the future.

In summary, it seems that the production of alternative energy, combined with conservation efforts, could revitalize rural areas of this country, especially in Minnesota. This effort would be helping the earth, helping to get our trade accounts back into balance, and be increasing our national security by decreased use of foreign oil. If anything could restore our sense of national purpose, this would be it. So, though the term has often been used, we need a kind of “Manhattan project” in the form of tax incentives, subsidies, and regulatory reforms to promote greatly expanded production of alternative energy.



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